HUB24 half-year results
Held in the portfolio of the Montgomery Small Companies Fund, the investment and superannuation platform provider HUB24 (ASX:HUB) has risen 116 per cent in the last 12 months. This week, the company released its results for the first half of 2025, with a lot to like.
The company delivered another set of robust half-year results, with notable growth across its platform and technology solutions businesses.
HUB24 raised its FY26 platform funds under administration (FUA) target to $123-$135 billion (a three to 13 per cent increase), reflecting strong net inflows, favourable market movements, and a solid pipeline across all customer segments.
Record net inflows
Platform net inflows grew 31 per cent year-on-year to $9.5 billion in the first half of 2025, while new licensee relationships contributed 12 per cent of inflows.
Accelerating growth of adviser base
Total active advisers rose 14 per cent year-on-year to 4,886, representing 31 per cent of all Australian advisers, and the net addition of just over 360 advisers in the first half of 2025 comfortably exceeded the average of the last three first-half years of just under 280.
FUA and market share gains
Total FUA reached $120.9 billion (+33 per cent year-on-year), comprising platform FUA of $98.9 billion (+36 per cent year-on-year), and portfolio, administration and reporting services (PARS) FUA of $22 billion (+17 per cent year-on-year). HUB24’s reported market share increased 1.3 per cent year-on-year to 7.9 per cent (as of September 2024).
As of 13 February, platform FUA has exceeded $102 billion growing by $3.7 billion since the end of the first-half of 2025.
FUA per adviser was $20 million (up from $10 million in the first half of 2021), though still behind the industry average of $75 million, suggesting ample room for market capture.
Revenue and profit growth
Revenue rose 25 per cent year-on-year to $195.2 million, while underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA) jumped 41 per cent to $77.6 million, translating into a margin of 39.8 per cent (+4.7 per cent year-on-year). Underlying net profit after tax (NPAT) increased 40 per cent to $42.6 million, with a $0.24 cash per share dividend declared (+30 per cent year-on-year).
Capital expenditure (CapEx) of $10 million was down ~8 per cent year-on-year, with total FY25 CapEx expected to be around $20 million.
Improved operating efficiency
Benefiting from price increases, growth in HUB24’s acquisitions – including Class, a market-leading self-managed super fund (SMSF) administration software provider, and NowInfinity, a platform offering legal document automation and corporate compliance solutions – as well as a small reduction in operating expenses, the tech solutions division’s margin expanded 7.3 per cent to 36.4 per cent and revenue grew nine per cent.
56 per cent of advisers now use managed accounts, up materially from 35 per cent pre-pandemic. HUB24’s managed accounts funds under management (FUM) reached $42 billion in December 2024, growing by 43 per cent per annum over five years.
The Class product commands a 30.4 per cent share of the SMSF market, with over 210,000 Class accounts, and 818,000 companies using NowInfinity’s Corporate Messenger – growing at almost double the growth rate of the market.
What to watch
Almost worth ignoring, the platform revenue margin of 32 basis points was down marginally (0.1 per cent) versus the second half of 2024, and this was due to lower admin fee margins as well as slightly lower cash management fee margins. Operating expenses also climbed 17 per cent to $117.6 million, primarily due to variable costs linked to FUA growth and despite total full-time employees remaining stable at 882 (suggesting roles and salaries may have changed).
HUB24’s half-year results reflect solid execution, elevated inflows, and clear traction in both platform and tech solutions. While revenue margins face some downward pressure, ongoing efficiency gains and strong adviser growth underpin management’s confidence in achieving upgraded FUA targets.
The Montgomery Small Companies Fund owns shares in HUB24. This article was prepared 19 February 2025 with the information we have today, and our view may change. It does not constitute formal advice or professional investment advice. If you wish to trade HUB24, you should seek financial advice.
Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
